DRIP

DRIP stands for dividend reinvestment plan, a feature many brokers and companies offer that automatically uses any cash dividends received to buy more shares of the same stock, often without a trading commission, instead of paying the dividend out as cash.

Reinvesting dividends this way harnesses compounding, since each new share purchased can itself go on to generate future dividends. Over long periods, reinvested dividends have historically made up a significant portion of total stock market returns.